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Services Up PetSmart Sales

PHOENIX-Double-digit growth of grooming, training and PetHotel business joins healthy sales gains.

By Marita Thomas | Updated on November 16, 2006

PHOENIX-PetSmart Inc. stores groomed 1.8 million animals, trained 93,000 dogs and increased the number of in-store PetHotels from 48 to 57 during third quarter. As a result, sales of the pet services component of the locally based pet-supply store chain grew 25.4% in the third quarter, following a 23.8%-increase for the same quarter a year ago.

Overall PetSmart sales reached $1 billion for the quarter, up 14% from $907.7 million in the third-quarter of 2005. And comp-store sales rose 6.8% on top of a 2.4%-gain in the parallel 2005 third quarter. During a conference call, Bob Moran, president and COO, said, “grooming, training and day camps build loyalty, causing customers to spend more in our stores and also create word-of-mouth referrals.”

The success of services in general and pet hotels in particular prompted the company to add nine pet hotels for the quarter. “At full build out,” Moran projects an eventual total of 435 pet hotels, which is an increase more than the company’s previous estimate. “At maturity,” he forecasts that pet hotels will generate a 29% increase in overall store revenues.

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